Page 41 - Band_6_WGI_05_Leseprobe

Volkswirtschaftslehre 2014 L
2.3 –
The government can boost demand through fiscal stimulus in order to reflate the eco­ nomy, for example by building or refurbishing infrastructure, or by lowering income tax rates, hoping for additional demand from households.
2.4 –
If a minimum wage successfully increases average wages, this should, in turn, increase overall demand for goods and services which might well increase demand for labour (−> purchasing­power theory).
2.5 –
(2 aspects required)
Social isolation and financial worries can contribute to poor mental and physical health, driving up healthcare costs.
– This, however, will not make the existing structural mismatch between labour demand and labour supply go away.
– The perfect competition model holds neither for the labour market in general nor for its many segments. Many businesses employing the low paid don’t require fewer staff just because they have to pay them £6.31 per hour instead of £5.50, for example. The reason why many employers are in a position to pay very little in the absence of a minimum wage is that due to a lack in qualifications, the low paid often have little bargaining power compared to their employers.
– Those receiving higher wages may also feel a morale boost resulting in higher produc- tivity.
– Low self-esteem may lead to a decline in social contacts, which could result in less vol- unteerism within a community. More tasks may have to be paid for by that community.
– Criminal behaviour may drive up the cost of law enforcement.
– The unemployed may not be in a position to provide their children with good education. Hence, job prospects and future earnings may be negatively affected, resulting in lower tax revenues and higher social benefits to be paid out.
(1 example required)
[ Inhaltsverzeichnis ] [ Aufgabe ] 53 L4 2014